New Delhi, Aug. 17: The government is weaving in last-minute changes in its controversial drug policy, which could narrow down the list of drugs with price caps, while persuading corporate houses to agree to self regulation in pricing new drugs.

The government wanted and the pharma firms have today agreed to fix generic drug prices in a manner such that wholesale margins were limited to 15 per cent and retail profits to 35 per cent from October 2, 2006. The drug policy, which was to come up before the cabinet on Friday, has been pushed back by a week and new changes are being worked in.

The government wanted to bring some 33 per cent of all drugs under price control against a current 25 per cent.

But chemicals and fertiliser minister Ram Vilas Paswan is ready to continue parleys with pharma companies to narrow down the list in return for commitments on a self regulation formula for new drugs.

The minister has already held three rounds of discussions with pharma majors and is holding another round today, which is likely to extend over the weekend.

While the industry and the government continue to have differences over the drug price control, Paswan said a 14-member committee had been formed to address various issues to find a middle path, where “the common minimum programme of the government is followed” without hampering the growth of the industry.

Paswan said the committee would look into six issues, including public-private partnership to help below-poverty-line families, concessional prices for government procurement, competition to contain prices, monitoring (when price fluctuation of drugs exceed 20 per cent in a year) to replace price control. The committee, which would have 11 members from the industry and three from the ministry, is expected to submit its report by September 30.

The government believes that by keeping prices low, pharma companies will be able to create a large mass market for generic drugs here. This, in turn, would help them lower costs and compete better in the global markets. China and East Europe will soon emerge on the global scene as major competitors to India’s pharma majors.

The minister has told his cabinet colleagues and newspersons that his plans to place 354 essential drugs under price control were in consonance with Supreme Court rulings. However, he now seems to have adopted a more flexible stand.